Majestica Hotel In Shanghai Essay

Majestica, a luxury hotel precaution service line of products began in 1970 in Western Europe. Majestica gradually expand to unite Kingdom, United States, North America, Asia and so on. After a gradual expansion in Asia, Majestica become the lands largest operators of luxury hotel and resort. Majestica earn by hotel possession operation and hotel management but last five years they ar concerning to managing hotel. All over the world, owner and let outer of luxury hotels are attracted by Majestica because of their pure quality. Their key success factor is management pointed to a service close that they had fostered for decade. Moreover, their service culture is personal service oriented. Majesticas try go around to delight their customer by response to unusual request of the guest. This quaint service culture leads Majestica to icon in hotel management phone line in the world. They had two strategies to expand their business those are cautious to increase figure of speech of hotel and resort in their portfolio and operating philosophy.In Asia pacific region Majestica didnt take for the first time moving advantage because of high cost to completed new industry and they didnt convince about(predicate) political detail stability and existence of service culture. Majestica follow other major supranational luxury hotel chain and enter in Asian securities industry. In 1990, Majestica changed its dodge to enter Asian market because it was the alarming time for them. mainland China decorous the most competitive hotel industry and chinas economic develop and open door polity leads to china the second largest foreign choose investment recipient in the world. Finally, Majestica took the right decision to change schema and enter in Asias largest competitive hotel business market.China was ordinal most popular destination for business and tourist and would be first personateed by 2020. In 2004, in that respect were 423 hotels with 68000 rooms which expected to increase 11 percent by 2005. ingrain Tourism Administrative Commission also forecast that tourist visiting will increase by 5 percent. Mid 1998 international luxury hotel chains took the advantage of changed government policy soon they took place in Shanghai. Shangri-la,Hyatt international etc established and imbued thoroughly Shanghai luxury hotel market.On that time Shanghai was the best location for Majestica because of market demand, future benefit, resource, competition as well as government policy. spell cycles/second was publicly listed in Hong Kong gave Majestica more confidence about business transparency and independence from government influence. Majesticas excellent performance and character attracted CPS and property owner to invest in Shanghai. As a result Majestica and CPS signed an intent and start negotiation. The challenging write up was the length of the contract and the control over the management of the hotel.First of all, Majestica wants the treaty for 55 years while it was 10 years normal hotel management term in china. So both CPS and Majestica had to change their policy and agreed to 30 years operation period with a pick to extend operation period. Secondly, Majestica expect to design and construct by their of age(p) people while CPS put in to take decision. Than Majestica convince CPS that it is important to take senior people to keep chain of body of a world class luxury hotel construction. Selecting the name of the hotel, Majestica dont want to compromise. wherefore, Majestica want experienced person as general jitney who will accountable for over all operation. CPS wants a Chinese person to be a general manager though there was not any enough experience Chinese person.Then about expatriates, CPS wishes Majestica to train the local employees and eventually use them to replace the expatriates. Then CPS requested to Majestica to take a Deputy General Manager. In negotiation, CPS suggested to Majestica for purc hasing all necessity from the local market. Majestica disagreed to CPS for allowing admittance to hotel rooms because of confusion. Finally, Majestica want to appoint a third party to close any condition but CPS didnt agree to interfere of a third from outside China. For foreign investment law of China Majestica had to take 25 percent equity by the Majestica had to change the speeding limit minority investment policy.To increase the market share Majestica should slake its operating philosophy and take the opportunity to grave the leadership position in hotel industryin the world. If Majestica could change their philosophy and business perform than not only china but it could lead whole world and become global. To take this position Majestica need to change their management policy, market segmentation, human resource policy and aggressive expansion of hotel operating business.